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US letter allows for ethane to ship to China but not be unloaded

According to a copy of a letter and a source familiar with the issue, the U.S. informed Enterprise Products and Energy Transfer that they could load ethane onto vessels bound for China but not unload it at a Chinese port without permission.

The U.S. Department of Commerce sent the letters after notifying the companies of the requirement for a license on exports of Ethane to China.

A person with knowledge of the situation said that it is unlikely that the companies would risk sending the vessels on their way after loading ethane onto them. The companies may have to pay penalties up to double the value of ethane if the vessel reaches China.

The letter stated that Enterprise Products was authorized to load vessels with Ethane and transport them in foreign ports. This authorization included a party in China. Enterprise Products is not allowed to complete the export...to a Chinese party...without BIS approval.

Enterprise Products and Energy Transfer has not responded to comments immediately.

Likewise, the U.S. Department of Commerce did not respond immediately to a comment request.

It would be possible to relieve congestion in ports near Houston where ships have been unable to move due to restrictions on shipments of the product to China.

(source: Reuters)